There are plenty of areas around the Bay Area that meet your requirements. First, let me clarify that a 1 hour commute during the peak of rush hour would get you about 15 miles from Milpitas. That puts you into some older neighborhoods in Fremont, Sunnyvale, and San Jose. Homes are generally about 40-50 years old and in the 1200-1600 sqft range with 3 beds and 2 baths.
If you can commute during off-peak hours, you can get to Tracy and Livermore in 34-45 minutes. Both have newer (5-10 year old) single family homes in the $250-$350K range, with homes up to 2500 sqft. You can also get similar deals along the coastal areas of the east bay, like Hayward, San Leandro, or even Union City for slightly older homes. Down south, you can hit Morgan Hill in about 30 minutes. Or, if your commute time is very ideal, you can make it down to Gilroy in 45-55 minutes and get a single family with a small ranch.
As the prior answers have suggested, you can find homes within your price range in a variety of communities that may be within a one hour drive of Milpitas. As this is a major purchase, and a potentially long term commitment for you, I would suggest you pick an area that may be of interest, and spend the night in a hotel, and actually drive the commute to your office. Milpitas, like most of these communities, is spread out and depending on the exact location of your home and your office, can make a 15+ minute difference in your drive.
Enjoy the process!
It depends on whether you want to be in an area with good schools. If schools are not important, you can get some good deals in Hayward, Newark, Union City. Some parts of Fremont also have SFR under $350k. Keep in mind these homes are going to be older homes although they are all within a 1 hour or less of drive time (depending on what time you are commuting).
H U S Achievers Realty
All the best to you.
I hope that helps, feel free to contact me if you would like some searchs set up for you or if you have any questions.
At your service,
CDPE- Certified Distressed Property Expert